Tax Liability of Commercial Credit Corporation

July 8, 1959 BIR RULING NO. 323-59 Mr. Carlos J. Valdez 6th Floor, San Luis Terraces 640 San Luis, Ermita M a n i l a S i r : Reference is made to your letter dated July 7, 1959, wherein you stated the following: "Our client, the Commercial Credit Corporation, a duly organized organization with the Securities and Exchange Commission, buys promissory notes from businessmen for goods purchased on installment and undertaking at his risk collection of the amounts covered. "Question: We would like to know whether said corporation is subject to tax under section 182 of the National Internal Revenue Code." In reply thereto, I have the honor to inform you that a person buying promissory notes from businessmen executed in favor of the latter by buyers for goods purchased from them on installment, himself undertaking at his risk the collection of the amounts covered thereby from the respective makers thereof, is not subject to any internal revenue tax. However, if he resells the said notes, he is considered a dealer in securities within the purview of section 194(r) of the Tax Code, and as such, he is subject to the fixed tax prescribed in section 182(A)(3)(S) of the same Code. (BIR Ruling, Apr. 22, 1954, cited in II Araas Anno. on Natl. Int. Rev. Code, pp. 491-492) cdi Very truly yours, (SGD.) JOSE ARAAS Commissioner of Internal Revenue